Wednesday, 18 November 2009

At the 2010 China Industrial Development Forum on November 7th, Chinese officials reaffirmed their commitment to alternative energy, particularly solar, according to visit note by Goldman Sachs.

Goldman: solar energy is the other rapidly developing industry in China as China now accounts for about 1/3 of solar energy production capacity globally. The speaker refuted the view that PV cell production is an energy-ineffective process as he pointed out that the energy breakeven time is about 2 years for PV cells (energy used to produce PV cells equals the energy generated by the PV cells) but the normal lifetime is around 20 years. He also believes that solar energy could become commercially viable in the foreseeable future as the energy generating cost has been reduced from Rmb4 to Rmb1.1 per kWh over the past few years and is getting close to the Rmb0.3-0.4/kWh level of coal-fire power plants.

Given the tendency for silicon-based technology to advance at a much faster rate than most other technologies (as seen with chip speeds, and now with solar's falling cost), then should current trends continue, solar could feasibly become cheaper than coal in the not too distant future. Regardless, energy policy trends seem very much in solar's favour given China's ambitious alternative energy goals, in addition to those of developed nations.